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Porsche will cut its local dealer network in China due to falling profits and weak demand, according to foreign media reports.

In the first three quarters of this year, Porsche's operating income fell 5 per cent year-on-year to 28.56 billion euros, former operating profit fell 27 per cent year-on-year to 4.04 billion euros, net cash flow of cars fell 63 per cent year-on-year to 1.24 billion euros, and operating return on sales was 14.1 per cent, down from 18.3 per cent in the same period last year, according to the results. In terms of performance guidance, Porsche keeps its full-year revenue forecast unchanged at 39 billion-40 billion euros and its full-year operating profit margin expected to remain unchanged at 14% 15%.

Porsche sold 226026 vehicles worldwide in the first three quarters, down 7 per cent from a year earlier, according to sales data. In terms of market segments, Porsche sales rose 8 per cent year-on-year to 26838 vehicles in its home market, 1 per cent to 52465 vehicles in Europe (excluding Germany) and 3 per cent to 41972 in overseas and emerging markets. In terms of sales scale, Germany's largest single market is North America, which is down 5% from a year earlier, but sales of 61471 vehicles have surpassed those in China, which sold 43280 vehicles, down 29% from the same period last year. Porsche said the decline in sales in China was mainly due to continued tight price competition and Porsche's focus on value-oriented sales.

At present, Porsche has seven models on sale in the Chinese market, including Panamera, 718, Macan, Cayenne and 911, and pure trams including Taycan and Macan EV. Under the frenzied price offensive of Chinese car brands, Porsche, which is positioned as a luxury, is getting harder and harder to be favored.

A few days ago, Porsche sold for less than 400000 has become a hot search. According to reports, Shenzhen dealers currently offer a naked car with a Macan of less than 400000 yuan. Take the 2024 Macan 2.0T as an example, the manufacturer's guiding price is 578000, while the local dealer offers a minimum naked car price of 358000 yuan, equivalent to a 40% discount. However, it is often a gimmick to mark the car price with the naked car price, and the landing price refers to all the expenses spent from buying a car to being able to drive on the road, even if it is calculated on the basis of a naked car quotation of 358000 yuan. coupled with Porsche selection and a series of expenses such as vehicle purchase tax, insurance fee and license fee, the landing price is at least around 600000. Of course, I have to admit that Porsche is really difficult to sell in the Chinese market, and the decline in sales is the best proof.

There are two main reasons for Porsche's sudden collapse in the Chinese market: one is that Porsche's electric transformation is not ideal. At present, Porsche's sales in the Chinese market are still supported by fuel vehicles, and the launch of Taycan and Macan EV is basically difficult to provide strong market growth potential. Second, compared with domestic new energy models at the same price, Porsche electric models have no obvious advantages. Especially as a number of domestic brands focus on the high-end luxury market, Porsche's high added value has been unable to support.

In order to reverse the decline of the Chinese market, Porsche is trying to be smart. According to 36 Krypton, Porsche's China R & D team is being expanded. Making up for intelligent cockpit, ADAS and other intelligent R & D capabilities is one of the goals of this expansion. Porsche R & D team will move from Shanghai Pudong to Shanghai Jiading. It is understood that the Porsche China R & D team was established in 2022, which is the second large-scale recruitment since the team was founded.

In order to keep up with the transformation of intelligent electrification in China, Porsche has increased its investment in related areas of the Chinese market. The current Porsche machine supports the Carplay2.0 version. In terms of intelligence, Porsche models currently on sale can only achieve relatively simple voice control, such as operating seat heating, vehicle air conditioning and so on. At the same time, the probability of successful voice operation and execution speed are also limited to a certain extent. With the increasing demand of consumers for intelligent cars, foreign car brands have begun to focus on the research and development of intelligent cockpit and intelligent driving in the Chinese market. Obviously, Porsche's move is to improve the competitiveness of its products in the Chinese market.

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